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1 S P E C I A L R E P O R T FAO/WFP CROP AND FOOD SECURITY ASSESSMENT MISSION TO THE SYRIAN ARAB REPUBLIC 5 July 2013 FOOD AND AGRICULTURE ORGANIZATION OF THE UNITED NATIONS, ROME WORLD FOOD PROGRAMME, ROME

2 - 2 - This report has been prepared by Swithun Goodbody (FAO), Francesco del Re (FAO) Issa Sanogo (WFP) and Byron Ponce Segura (WFP) under the responsibility of the FAO and WFP Secretariats with information from official and other sources. Since conditions may change rapidly, please contact the undersigned for further information if required. Shukri Ahmed Muhannad Hadi Senior Economist, EST-GIEWS Regional Emergency Coordinator, Syria and Neighbouring Countries Trade and Markets Division, FAO Regional Emergency Coordinator's office Fax: Fax giews1@fao.org Muhannad.Hadi@wfp.org Please note that this Special Report is also available on the Internet as part of the FAO World Wide Web at the following URL address: and The Special Alerts/Reports can also be received automatically by as soon as they are published, by subscribing to the GIEWS/Alerts report ListServ. To do so, please send an to the FAO-Mail-Server at the following address: mailserv@mailserv.fao.org, leaving the subject blank, with the following message: subscribe GIEWSAlertsWorld-L To be deleted from the list, send the message: unsubscribe GIEWSAlertsWorld-L Please note that it is now possible to subscribe to regional lists to only receive Special Reports/Alerts by region: Africa, Asia, Europe or Latin America (GIEWSAlertsAfrica-L, GIEWSAlertsAsia-L, GIEWSAlertsEurope- L and GIEWSAlertsLA-L). These lists can be subscribed to in the same way as the worldwide list.

3 - 3 - TABLE OF CONTENTS Page Acronyms and abbreviations... 5 Mission highlights OVERVIEW BACKGROUND AND SOCIO-ECONOMIC CONTEXT General Agriculture CROP PRODUCTION, Assessment methods Area estimates Factors affecting yields Rainfall Irrigation Inputs Mechanization Pests and diseases Farm access and movement of farmers Cereal production in Yields Production Harvesting and storage OTHER CROPS Sugarbeet Cotton Tobacco Tree and horticultural crops LIVESTOCK LOCAL FOOD MARKET CONDITIONS Wheat supply chain Availability of food commodities in local markets Local markets response capacity Food price trends and volatility Terms of trade CEREAL SUPPLY/DEMAND SITUATION Population Stocks National cereal balance Ongoing food production assistance HOUSEHOLD FOOD SECURITY SITUATION Methodology Main drivers of household food insecurity On-going food access assistance

4 Recent changes in household food access indicators Livelihoods and income sources Household expenditures Household food consumption Household coping mechanisms Estimate of food assistance requirements RECOMMENDATIONS... 34

5 - 5 - Acronyms and abbreviations ASIS CBS CFSAM EIU EU FAO FAOSTAT GAPAR GDP GFD ha ICRC IFRC kg MAAR mm MoFA MWR NDVI NGO NPK OCHA SARC SHARP SYP t UN UNDP UNHCR UNWRA USD WASH WFP Agricultural Stress Index System Central Bureau of Statistics Crop and Food Security Assessment Mission Economist Intelligence Unit European Union Food and Agriculture Organization of the United Nations Data programme of FAO Statistics Division General Authority for Palestine Arab Refugees Gross Domestic Product General Food Distribution Hectare International Committee of the Red Cross International Federation of Red Cross and Red Crescent Societies Kilogramme Ministry of Agriculture and Agrarian Reform Millimetre Ministry of Foreign Affairs Ministry of Water Resources Normalized Difference Vegetation Index Non-Government Organization Nitrogen, phosphorus, potassium Office for the Coordination of Humanitarian Affairs Syrian Arab Red Crescent Syria Humanitarian Assistance Response Plan Syrian pound Tonne United Nations UN Development Programme UN High Commissioner for Refugees UN Agency for Palestinian Refugees US dollar Water, sanitation and hygiene World Food Programme

6 - 6 - Mission highlights Seasonal rainfall in 2012/13 was better than in any of the previous five years, especially in the northern cereal-producing governorates. Relatively less area was planted to cereals, compared to the last ten years. Contributing factors include high costs of production, reduced input availability including labour, prevailing violence, related damage to farm equipment, and abandoned land. The area under irrigated cereal production also declined significantly owing to power cuts, and damage to power stations, canals, and pumps; and high diesel costs. The supply chain of wheat is severely affected. Road transport is becoming increasingly expensive and is often unsafe, and less than one-third of the Government's wheat collection centres are operational. Most flour mills and bakeries are either no longer operating, or are operating at low capacity. Only 1 in 4 yeast factories is operational. Pre- and post-harvest grain losses are higher than average this year, due mostly to damage to harvesting equipment and storage structures. Accordingly, the 2013 wheat production is estimated at 2.4 million tonnes, significantly lower than the average for the ten years prior to 2010/11 that exceeded 4 million tonnes (a 40 percent decline) and 15 percent below the poor 2011/12 crop. The barley crop, which is predominantly rainfed, is expected to be close to one million tonnes, above the average annual production of tonnes for the ten years prior to 2010/11. The wheat import requirement in 2013/14 (July/June) is estimated at about 1.47 million tonnes of which 1 million tonnes are anticipated to be imported commercially, leaving an import requirement of tonnes. The livestock sector has been seriously depleted by the ongoing conflict. Poultry production is estimated to be down by more than 50 percent compared with 2011, and sheep and cattle numbers are down approximately 35 percent and 25 percent respectively. The Government's veterinary service is significantly eroded. Vaccines are in short supply and sanctions prohibit imports. Most private companies that were producing prophylactics have gone out of business because of damage to their premises and because of the difficulty importing. Due to higher prices; more Syrian livestock are being sold in Jordan, Lebanon, Turkey and Iraq. With the virtual loss of veterinary services within Syria, livestock diseases are being transmitted to neighbouring countries, thereby posing a potentially serious regional animal-health problem. An exodus has occurred from Syria; 1.6 million Syrians have become registered refugees in neighbouring countries as of the end of May In addition, it is suspected that many have departed as unrecorded voluntary emigrants. Over 4 million people have moved from their original residence to other locations in the country, leaving behind or losing their assets and income sources. Livelihoods, income earning, and purchasing power have suffered huge losses. The official 2013 unemployment rate is 18 percent; more than twice the 7-year average ( ) of 8 percent. Inflation is rampant, and Syria s currency has experienced major devaluation. In 2012, year-on-year inflation rose by 50 percent from The 2013 inflation rate is expected to rise above 30 percent. The official value of the Syrian pound has declined sharply by over 115 percent since Commodity costs have risen significantly. The real price of wheat flour has almost doubled from 2011, while that of livestock has fallen. Amongst non-food items, diesel has had the sharpest escalation in cost, with a 200 percent jump in January 2013, after cuts in Government subsidies. Food markets are seriously disrupted. In addition to higher prices; food access is compromised due to lower quantities of food in the markets. Main impediments to trade include insecurity, transport constraints, credit for suppliers, and foreign currency shortages. The quality of the Syrian diet and micro-nutrient intake is likely reduced. Many households are cutting back substantially on the consumption of fruits, meat, dairy products and eggs. Approximately 4 million people are facing food insecurity. Most vulnerable groups include the internally displaced, small scale farmers, and herders; casual labourers, petty traders, the urban poor, children, pregnant and lactating mothers, the elderly, the disabled and the chronically sick. In order to assist the most affected people in need of food assistance, an estimated tons of cereals will be required from mid-2013 to mid The damage to infrastructure, plant and machinery inflicted by the deteriorating security situation will have an effect beyond the current season and longer term measures need to be put in place to rebuild food systems.

7 OVERVIEW Following a request to FAO from the Ministry of Agriculture and Agrarian Reform (MAAR) on 27 March 2013, a joint FAO/WFP Crop and Food Security Mission (CFSAM) visited the Syrian Arab Republic between 18 May and 8 June In Damascus, the Mission had meetings with the Ministry of Foreign Affairs (MoFA), The Ministry of Agriculture and Agrarian Reform (MAAR), and the Ministry of Water Resources. Meetings were also held with the General Establishment for Cereal Trade and Processing, a department within the Ministry of Economy and Trade; the FAO national consultant on livestock; the National Agricultural Policy Center (NAPC); UNDP; OCHA; the resident FAO office; and the resident WFP office. From 27 May to 1 June the Mission undertook a short field trip to Homs, Tartous and Al Hasakeh Governorates. In each governorate, meetings were held with MAAR s Agricultural Directorate. The Mission met small farmers, horticultural producers and traders in Homs and Tartous and visited some production units, while in Al Hasakeh a group of 15 cereal farmers and livestock owners came to Qamishly to meet the Mission and discuss the current crop and livestock situation in the governorate. The field trip was limited not only by the small number of locations visited but also by the fact that those locations were exclusively within Government-held areas; no opposition-held areas were visited. In addition to Government information, other sources of information used by the Mission in its assessment allowing a degree of triangulation included: Vegetation-related satellite imagery (NDVI and ASIS); a set of questionnaires distributed through, and completed by, MAAR officers in 13 of the country s 14 governorates (Dara a was omitted as the current crisis prevented the movement of MAAR officials from that governorate); meetings with MAAR officers from 13 of the country s 14 governorates while they were in Damascus for a training course (again, Dara a was omitted); records and reports from MAAR and the Central Bureau of Statistics; recent reports from UN and other agencies; discussions with independent NGOs and Internally Displaced People (IDPs). Compared with recent years, rainfall during the 2012/13 cropping season was favourable, especially in the northern cereal-producing governorates, and rainfed cereals benefited accordingly. The Badia (the steppe of south-eastern Syria) also benefited, providing better grazing for livestock. However, crop and livestock production, food availability and access to food have all taken an increasingly heavy toll over the last year as a result of the various ramifications of the ongoing events within Syria. The threat of violence has caused large numbers, including farmers, to leave the country and even larger numbers to move from their homes to safer areas within the country. Many of the means of production, processing and storage of crops have been either damaged or destroyed, such as tractors, harvesters, pumps, irrigation canals, cotton ginneries, and grain silos. Internationally imposed financial and other sanctions have exacerbated the situation, leading to shortages of agricultural inputs, crop-protection materials, diesel, and spare parts for machinery. The livestock sector has been especially badly affected by the current situation and by the internationally imposed sanctions. There is now, in many parts of the country, a virtual absence of routine drugs, vaccines and the veterinarians to administer them, as well as ongoing protracted shortages of concentrate feed. In addition, the Syrian pound has experienced significant devaluation over the past six months making it more difficult for producers to purchase the necessary production-related materials that are still available. The overall results include a reduction in the area of cropped land and an anticipated further reduction in the area of land harvested; crop yields that are lower than they might otherwise have been in a year of satisfactory rainfall; difficulties in transporting and marketing agricultural produce; a highly significant depletion of the livestock sector; possible regional implications for outbreaks of livestock diseases in neighbouring countries because of cross-border sale of un-inoculated animals; loss of livelihood for a very significant section of the population; and an accelerating exodus from agricultural production.

8 - 8 - The Government has attempted to ease the situation for both the producer and the consumer by offering a financial premium to wheat producers and by continuing to subsidize the price of bread. The premium for producers has, however, already been more than overtaken by the other escalating costs of production and marketing and by the fall in the value of the Syrian pound, while the amount of bread that can be made available at a subsidized price is far below what is required to satisfy demand. The other Government support mechanisms for producers such as subsidised fertilizer and livestock concentrates are now rare and irregular. Nevertheless, the Government has managed to secure some substantial imports of wheat in spite of the prevailing international sanctions. If the present conflict continues, the food security prospects for 2014 could be worse than they are now. With so many adverse factors now stacked against the crop and livestock sectors, and assuming that the present crisis remains unresolved, domestic production over the next twelve months will be severely compromised. The Mission estimates that wheat production this year will be approximately 2.4 million tonnes. This is 15 percent lower than last year s estimated production of 2.84 million tonnes, and significantly below the average of more than 4 million tonnes achieved prior to the crisis. Officially registered stocks of wheat amounted to approximately 2.9 million tonnes at the beginning of It was not possible for the Mission to assess the amount held domestically and by merchants, but it is assumed that it is relatively small in view of the fact that many grain-storage structures have been either seriously damaged or destroyed since The Mission thanks the many agencies that provided invaluable information during its time in Syria, in particular the various directorates of the Ministry of Agriculture and Agrarian Reform (MAAR) at both central and governorate level. With regard to logistical support, the Mission thanks the Ministry of Foreign Affairs (MoFA), and the country offices of FAO and WFP. 2. BACKGROUND AND SOCIO-ECONOMIC CONTEXT 2.1 General The ongoing crisis in Syria has had a very significant effect on the country s population. Under normal circumstances and using the average pre-crisis growth rate, the population would be expected, by the end of 2013, to number about 22 million. However, with a large exodus of voluntary and involuntary refugees, mainly to neighbouring countries, it is estimated that the population will, in fact, be about 20 million. In addition, the crisis has caused extensive movement of about 6 million people within the country, with the result that population density in some urban and peri-urban areas has increased dramatically while in other areas populations are severely depleted. The Syrian economy grew at a moderate average rate of about 4.5 percent a year from 2001 to The per capita GDP grew at a lower rate of 2 percent a year due to an increased annual population growth rate (2.45 percent) over the same period. Economic growth was driven mainly by the transport, communications, manufacturing, finance, real-estate, and construction sectors. The agriculture sector, which was frequently hit by droughts, contributed relatively little to the country s real economic growth. The pre-crisis decade ( ) was characterized by a relatively stable economic situation with low levels of inflation, public debt and fiscal deficit, and healthy trade and current-account balances. In 2010, fiscal deficit was estimated at less than 5 percent of GDP; inflation was below 5 percent; the external current-account balance was slightly in deficit; public debt was estimated at about 23 percent of GDP; and international reserves amounted to almost USD 20 billion. The decade-long benefits of the economic growth on the population were mixed. The unemployment rate remained stable at about 8 percent between 2003 and 2010, but this masked a high female unemployment rate which was reported as 22 percent in About 18.2 percent of the population was estimated to have fallen below the food-poverty line in 2009, with an increasing inequality in rural areas where the farming population was adversely affected by poor climatic conditions and consecutive years of severe drought. Idleb, Rural Damascus, Homs, Dara a, Al Sweida and Hama governorates were considered to have the highest proportions of households living below the food poverty line.

9 - 9 - The ongoing situation which started in 2011 has reversed most of the benefits of the decade-long economic growth. Real GDP growth is estimated to have contracted by 3.4 percent in 2011 and dropped sharply by almost 19 percent in The contribution of the industrial sector to the economic contraction is estimated at 36 percent. This is followed by an estimated 21 percent contraction of gross agriculture production in 2012, reducing further the share of agriculture in the economy. Estimates show that agriculture contributed to less than 17 percent of GDP in 2011, down from 20.4 percent in Continued contraction of the agriculture sector has a negative knock-on effect on rural incomes (and thus private consumption). This, combined with soaring inflation and rapid depreciation of the Syrian pound (SYP), has a severe negative impact on the living conditions of the population. Available official data indicate that year-on-year inflation surged by about 50 percent in 2012 (see Figure 1), owing, in particular, to higher costs of foodstuffs and fuel, with cereal price inflation reaching over 60 percent. Average consumer price inflation is officially forecast at 32 percent in In the 26 months since the onset of the crisis in March 2011, the official value of the SYP has fallen by more than 115 percent; on the informal market the devaluation has been even greater. Figure 1: Syria - Monthly rate of inflation (year-on-year) 2.2 Agriculture Source: Central Bureau of Statistics. In recent years, agriculture has played a very important part in Syria s economy, contributing some 18 percent to its GDP, and involving 17 percent of its labour force. Prior to the current circumstances, some 46 percent of Syrians (10 million) were rural dwellers, and of these about 80 percent derived their livelihood from agriculture. The country is divided into the following five agro-ecological zones based on the level of annual precipitation received. Figure 2 shows the approximate locations of the different zones. Zone I covers some 2.7 million hectares and has an average annual rainfall of mm. Zone II covers about 2.5 million hectares and has an average annual rainfall of mm. Zone III covers about 1.3 million hectares and has an average annual rainfall of mm. Zone IV is agriculturally marginal, with a total area of around 1.8 million hectares and an average annual rainfall of mm. Zone V is the Badia or steppe; it has a total area of approximately 8.3 million hectares and an average annual rainfall of less than 100 mm.

10 Figure 2: Syria - Agro-ecological zones Legend Climatic Zone: First (> 600 mm rain) Second ( mm) Third ( mm) Fourth ( mm) Fifth ( < 200 mm) Syrian Provinces: 1-R. Damascus 2- Damascus 3-Aleppo 4-Hama 5-Homs 6-Lattakia 7-Tartous 8-Idleb 9-Dara a 10-Sweida 11-Deir ez-zor 12-Hasakeh 13-Raqqah 14-Quneitra Source: FAO. Approximately 1.5 million hectares are normally irrigated, of which ha are accounted for by state-administered irrigation schemes. Permanent crops (olives, fruit trees etc.) account for about 5.7 percent of the country s agricultural land. Although agricultural production is now almost totally privately based, carried out mostly by a large number of relatively small farm units, the State has played, and continues to play, a significant role in subsidising agricultural inputs, purchasing crops from producers and subsequently either marketing the commodities to consumers or exporting them abroad in case of four selected strategic crops (wheat, cotton, sugarbeet and tobacco). The State has also been the main channel for the distribution of seed and fertilizers and for the provision of veterinary support to the livestock sector. The State is also involved in the management of irrigation schemes for private producers. From the 1960s until the mid-2000s the State also played a part in the production of strategic crops and livestock products, including milk, meat, poultry and eggs, these being produced on a small number of large state-owned and state-run farms. (This production role should not be confused with the State s involvement in the management of irrigation schemes for private producers.) Over the years, however, the State withdrew gradually from its productive role, as is shown in Table 1. The table also suggests that the proportion of State farmland actually cultivated, which was already less than half by 1970, also declined during the 30-year period By 2004/05, the State had relinquished its management of most of its farms and had allocated parcels of ex-state-farm land to the workers for their use according to a set of social and technical criteria. However, the legal title to the land of the ex-state farms remains with the State. Table 1: Syria - Land under State farms (ha), 1970 and 2000 Year Total Cultivated Source: Syrian Agriculture at the Crossroads, FAO Agricultural Policy and Economic Development Series No. 8, Prior to the current events, Syria was a significant exporter of agricultural produce, including cotton, sugar, tomatoes, potatoes, oranges, apples, olive oil, sheep, cattle, poultry meat and hens eggs. The annual revenue lost as a result of the virtual extinction of agricultural exports due to the current circumstances has been estimated by MAAR at SYP 72 billion (about USD 0.5 billion).

11 CROP PRODUCTION, Assessment methods The prevailing conditions in many parts of Syria at the time of the Mission's visit imposed severe restrictions on the Mission's movements. The Mission was therefore obliged to rely more on secondary information than would normally be the case for a CFSAM. The main sources of information for the Mission were: Rainfall and temperature data, and vegetation-related satellite imagery. The satellite imagery showed, for the whole country, the monthly NDVI (normalized vegetation difference index) from May 2012 to May 2013, and the dekadal ASI (agricultural stress index) from December 2012 to dekad number 2 in April Reports from relevant ministries, UN agencies and NGOs. Interviews with Government technical staff. In Damascus, the Mission held discussions with staff of directorates within MAAR (the Directorate of Marketing, Statistics and Planning, and the Fodder Directorate), with the Ministry of Water Resources, and with the General Establishment for Cereal Processing and Trade within the Ministry of Economy and Trade. Prior to visiting the field, the Mission took advantage of the fact that FAO was conducting a training course in Damascus for MAAR officers from 13 of the country's 14 provinces (Dara'a was omitted because of access difficulties caused by the current situation). At the end of the training course, the Mission held brief interviews with representatives of each province in turn in order to obtain a quick overview of the agricultural and livestock situation in his or her province and to get an idea of the overriding problems facing agricultural production and the food security of the population. Questionnaires. In order to increase coverage under difficult circumstances and within a limited timeframe and enable triangulation with secondary sources, the Mission used the services of provincial MAAR officers to collect primary data in each of 13 of the country's 14 provinces (Dara'a, being especially affected by conflict, was omitted). Each MAAR officer was provided with four sets of questionnaires for key informants farmers, host households, IDP households and key informant traders. Responses to the questionnaires were reviewed by the Mission and used to enhance its understanding of the current crop and food-security situation in the country. A short field visit by the Mission to three of the country's 14 governorates (Homs, Tartous and Hasakeh). For reasons of safety, the Mission was restricted to Government-held areas. Apart from meetings with the Agricultural Directorate of each of the three governorates, the Mission interviewed a number of farmers, horticultural producers, livestock owners and traders, and was able to see some crops in the field. 3.2 Area estimates Under the prevailing circumstances it has not been possible for MAAR to determine accurately the area under cereal cultivation for Moreover, it is still unknown how much of the planted area will actually be harvested. There is, however, a general consensus amongst farmers and MAAR staff, and in the responses to the Mission s questionnaires, that the area planted to cereals in the 2012/13 cropping season was smaller than in previous years and that not all the planted area will be harvested. MAAR has made informed estimates of the amount of harvestable land in each governorate. The reasons for these reductions are numerous. Some farmers have abandoned their land because of the threat of violence, and others because of the high cost of inputs and fuel and the low returns for their produce. Of the farmers who remain on their land (a substantial majority), some have had their tractors, harvesters and other machinery damaged maliciously; others have reduced their cultivated area because of the low availability and high cost of fuel, inputs and labour. Some farmers have had their crops burnt maliciously. The area under irrigation in 2012/13 was severely compromised by power cuts resulting from damage to power stations, by damage to irrigation canals and pumps, and by the high cost of diesel. For example, the Agricultural Directorate of Hasakeh Governorate, a major wheat producer where, in normal years, irrigation accounts for approximately 40 percent of the total area under wheat, estimates that only 10 percent of its planned ha of irrigated wheat was actually achieved, and

12 that most farmers produced their wheat as a rainfed rather than an irrigated crop or else grew another, more drought-tolerant crop such as barley or lentils. With better rainfall this year than in previous years, the consequences have been less serious than they might otherwise have been. The loss of irrigated area is nevertheless of great concern since under normal circumstances the production from one irrigated hectare of wheat is equivalent to the production from between two and three rainfed hectares. A financial incentive of SYP 10/kg for wheat (now SYP 36 and SYP 37/kg for soft and hard wheat respectively) was introduced in December 2012 in order to encourage farmers to sell their produce to the Government. Had the incentive been introduced earlier in 2012 when farmers were preparing their land it might have encouraged them to grow a larger area of wheat, but such was not the case. Accordingly, an estimated million hectares of wheat, both rainfed and irrigated, were planted this year, representing a 15 percent reduction compared with the average of million hectares for the ten-year period The area planted to barley is estimated to be million hectares. Despite this year s more favourable rainfall this represents a reduction of about 6 percent from the ten-year average of million hectares. 3.3 Factors affecting yields Rainfall Rainfall in was relatively good compared with recent years, which included a major drought in As is shown in Figure 3, cumulative rainfall exceeded the average in most governorates and was especially high in the north-west and west of the country where it was occasionally excessive. Unusually heavy rains in May in Hasakeh and Raqqah Governorates (not shown in Figure 3) were reported to have lodged some of the standing cereal crop. In Deir ez-zor, on the other hand, cumulative rainfall was slightly below the long-term average, and mid-season distribution was poor. Figure 4, which shows the agricultural stress index (ASI) derived from satellite imagery, gives a favourable picture for most of the country with ASI at less than 5 percent, although greater stress is apparent in the Euphrates valley. Figure 3: Syria - Monthly rainfall (mm), 2012/13 and long-term average

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14 Source: MAAR. Figure 4: Syria -Crop area affected by drought (ASI), 2012/13 ( percent) Source: FAO.

15 Irrigation Syria has a total irrigated area of approximately 1.5 million hectares, most of which is situated in the valleys of the Euphrates River and its two main tributaries, the Balikh and Khabur Rivers. Public schemes, which are run by the Government but farmed by individuals, account for hectares or just over one-third of the total. Some schemes are gravity-fed but most are pumped. The main irrigated crops include wheat, barley and cotton, as well as vegetables, fruits and tree crops. In recent years there has been increasing concern about the over-exploitation of groundwater reserves resulting from unregulated drilling of wells in the private sector. The water table is reported to be falling, and water quality to be deteriorating with high levels of gypsum. The quality of water in the Euphrates is also said to have deteriorated on account of increased upstream irrigation use in Turkey leading to elevated concentrations of leachate. Syria s annual renewable water resources are estimated at 17 billion cubic metres, which is slightly less than the country s annual consumption of at least 18 billion cubic metres, some 88 percent of which is believed to be accounted for by agriculture (CIA Factbook). There are 165 dams in the country with a total storage capacity of 19.6 billion cubic metres (FAO). Irrigated crop production, especially of field crops, has suffered during the present crisis. Electricity power failures, damage to power stations and the malicious cutting of power lines have incapacitated several pumping stations; pumps have been damaged and stolen; and irrigation canals have been broken. Damage to irrigation canals in Raqqah Governorate, for example, is estimated at 10 percent, while in Deir ez-zor the figure is as high as 30 percent. Some schemes have been compromised or shut down because of a lack of essential spare parts for pumps. In addition, the low availability and high cost of diesel has persuaded many farmers using diesel-powered pumps either to cut back on their irrigation regimes or to revert to rainfed production. In some instances, however, it has been possible for farms to use shallow wells which require less energy for water abstraction. Loss of irrigated crop production is especially serious considering that yields of irrigated wheat in Syria are typically two to three times as high as those of rainfed wheat. This year, for instance, Raqqah Governorate reported a loss of ha of irrigated crop, which, in terms of production, may be considered as the equivalent of between and ha of rainfed crop in a year of average rainfall Inputs The availability and cost of agricultural inputs, diesel and labour vary markedly from location to location within the country, largely according to the level of conflict or unrest experienced at the location. In practically all cases, however, prices have gone up and availability has gone down. The availability of seed appears to have been least affected by the current events, with, for instance, an estimated 50 percent of cereal producers in Hasakeh Governorate obtaining their seed from the Government and 50 percent either from private commercial companies or, in some instances, from their own or their neighbours production. Price increases for cereal seed on the open market of between 10 and 90 percent were reported. The situation for 2013/14 will be different as most commercial seed companies have now gone out of business on account of the cost and risks of production, so cereal farmers are likely to have to depend solely on the Government for their seed; it is difficult to imagine that this demand will be met. Price increases for imported horticultural seeds have typically tripled. A packet of tomato seed that cost SYP last year now sells for SYP Year-on-year price increases of between 100 and 300 percent were reported for fertilizers. In Homs, a 50-kg bag of urea costs SYP from the Government, if available, and about SYP on the open market, while the cost of a bag of compound NPK fertilizer has gone up from SYP to SYP The recommended fertilizer application rates for wheat are 250 kg/ha for urea and 150 kg/ha for triple superphosphate. The amount of triple superphosphate actually used is said to be negligible, and it is safe to assume that application rates of urea have fallen significantly in response to low availability and high prices. Syria s only fertilizer factory, which is located in Homs, is still functioning but only operates at about 25 percent of its capacity.

16 Pesticides have also seen a sharp price rise over the last 12 months, exacerbated by the international ban on exports of chemicals to Syria. The prices of two unidentified products were reported to have tripled from SYP to SYP 7 500/litre and quadrupled from SYP to SYP 4 000/litre. Reported price increases for diesel have ranged from a low of approximately 20 percent in Damascus to 600 percent in Aleppo. Tractor hires and transport costs have risen to reflect these increases. In Homs, for instance, tractor hire cost SYP 900/hr last year; now it costs SYP 1 500/hr. Truck rental for a certain distance cost SYP 3 000/t in 2012, now it costs SYP 5 000/t. In Tartous, truck rental for a standard distance and standard load rose from SYP in 2011 to SYP in 2012 and SYP in Labour costs have typically increased by between 30 (in Damascus) and more than 100 percent. In Homs, labour last year cost SYP 500/day; now it costs SYP 1 000/day. In Tartous the daily rate rose from SYP 800 in 2012 to SYP in The steepest increases were reported in Al Qunaitera where the daily rate last year was SYP 500 and this year is SYP Horticultural producers in governorates such as Tartous, that are host to large numbers of people who have moved from elsewhere in the country, complain that although labour may be available from that pool of immigrants to the governorate, the required skills are lacking Mechanization Syrian agriculture has, for many decades, had a high level of mechanization, but the current circumstances have seriously compromised mechanized production in many ways. Fuel for agricultural machinery (tractors, combine harvesters) and irrigation pumps has been and continues to be in short supply and the fuel that is available is not only expensive but often contaminated. Sanctions have resulted in a shortage of spare parts; this is especially unfortunate in the many situations where the spare parts required are relatively standard and replacement would normally be simple and routine. The maintenance of agricultural machinery has suffered because of the departure from several producing areas, and often departure from the country, of skilled mechanics and technicians because of the current events. The crisis has also resulted in damage to, and destruction of, tractors, harvesters and other agricultural machinery including irrigation pumps. The Agriculture Directorate of Homs quantified such damage and concluded that at least 9 percent of tractors, 17 percent of seeders and harvesters, and more than a quarter of all irrigation pumps had been damaged (Table 2). Table 2: Syria - Damage to agricultural machinery in Homs Governorate Item Total number Minimum number of damaged machines Loss ( percent) Tractors Seeders and harvesters Irrigation pumps Source: Agricultural Directorate, Homs. The response to the reduction in mechanization has been, in the cereal sector, a reduction in cultivated area, and may also be expected to result in a reduction in harvested area. In the horticultural sector, a greater dependency on manual production methods is evident. As discussed above (Irrigation), the consequences of damage to pumps have included a reduction in the area of crops under irrigation, conversion from irrigated to rainfed cropping, the cultivation of higher-value crops on smaller areas, and conversion to more drought-tolerant crops Pests and diseases Despite the greatly reduced use of phytosanitary inputs this year due to high prices and low availability, there have been no reports of significant outbreaks of cereal pests or diseases, although some local instances of wheat rust and Septoria were reported. In the horticultural sector, there were reports of olive fly and aphids, but it is understood that their incidence levels were not unusually high.

17 Farm access and movement of farmers In some areas that have been badly affected by the current circumstances, a number of farmers have abandoned their farms because of the physical risk to themselves and their families. Others have abandoned their farms for operational or financial reasons; the required inputs are not available, machinery has been damaged, labour is not available, or the costs of production, transport of produce and marketing exceed the potential financial returns. 3.4 Cereal production in Yields Yields of rainfed wheat in Raqqah, the north of Hasakeh and parts of Deir ez-zor are expected to be higher this year than in 2011/12 because of the relatively favourable rainfall. Further south, however, where the rains were generally no better than in 2011/12, yields of rainfed wheat are expected to be lower than those of 2011/12 because of lower applications of fertilizer and less attention being given to crops in the field. Yields of irrigated wheat are expected to be lower than last year as a result of irregular delivery of irrigation water consequent upon the damage to pumps and irrigation structures, the high price of diesel, and the unreliability of the electricity supply. Homs Governorate, for instance, expects a substantial fall in yield from last year s 3.7 t/ha. Similarly in Hasakeh, yields of irrigated wheat have, in the past, been in the region of 4 t/ha. This year, because of inadequate electricity supply, the malicious cutting of electricity power-supply lines and damage to irrigation structures, yields are expected to fall to about 2 t/ha, and this on a greatly reduced area of irrigation. Overall average wheat yields (rainfed and irrigated) are expected to be just under 1.7 t/ha, or about 70 percent of the average of 2.42 t/ha for the period Barley yields, on the other hand, have benefited from the relatively good rains and are expected to be 0.79 t/ha, their highest level since Production In 2012 the Government purchased, from producers in Syria, 1.95 million tonnes of wheat for processing and tonnes of wheat for seed, giving a total of 2.27 million tonnes. The amount of wheat purchased by the Government has typically been about 80 percent of total production (Table 3), the remaining 20 percent being retained by farmers for processing in small private mills or for sale privately. This implies a total wheat production figure for 2012 of 2.84 million tonnes 1, compared with an average of just over 3.5 million tonnes for the previous three years. Table 3: Syria - Wheat bought by the General Establishment for Cereal Processing and Trade Year Total production (percent) 000 tonnes (Mission estimate) 1/ Source: General Establishment for Cereal Processing and Trade. 1/ Given the greatly depleted capacity of the Government to store wheat delivered by farmers, and the difficulty and expense of transporting wheat to Government collection centres, the Mission considers that this year only about 60 percent of total production will be delivered to the Government. The remaining 40 percent is expected to be retained by farmers for local milling or for domestic use as bulgur or cracked wheat. 1 The official Government figure for wheat production in is 3.61 million tonnes. However, in view of the amount purchased by the Government in 2012, the difficulties already being faced by farmers by early 2012, and the fact that 3.61 million tonnes would have exceeded the average production of the previous five years, this figure seems unduly high.

18 This year, 2012/13, the Mission considers, in the absence of more reliable data, that production will be the outcome of two opposing sets of circumstances. On the positive side, rainfall has been generally more favourable this year than last, and this will have boosted yields of rainfed wheat in several parts of the country. On the negative side, however, the harvested area will be less than that of last year, the irrigated areas were smaller than last year, and the reduced use of inputs means that it was impossible for farmers to take full advantage of this year s better rainfall. On balance, the Mission considers that the negatives will outweigh the positives, and that wheat production will be of the order of 2.4 million tonnes, 16 percent down on last year (Table 4 and Figure 5). (The official Government estimate of wheat production this year is million tonnes. However, as with the Government estimate for 2011/12, this strikes the Mission as being excessively high under the current adverse circumstances.) Table 4: Syria - Wheat production, ha t/ha t Sources: FAOSTAT, ; MAAR and Mission estimate, 2012 and Figure 5: Syria - Wheat production and area harvested, Sources: FAOSTAT, ; MAAR and Mission estimate, 2012 and With better rainfall this year, and the change by some farmers from irrigated wheat to rainfed barley because of the expense or difficulty of irrigating, barley production is expected to be close to 1 million tonnes, its highest since 2006 (Table 5). (These figures are in agreement with those of the Government.) Table 5: Syria - Barley production, ha t/ha t Sources: FAOSTAT, ; MAAR and Mission estimate, 2012 and Harvesting and storage The reduced availability of machinery due to damage to tractors and harvesters, and the limited ability of farmers to fuel existing machinery, will prolong the harvesting of cereals. These will likely lead to

19 greater losses in the field through shattering of grain; the standing crop will also be vulnerable for a longer period to malicious damage such as burning. In December 2012 the Government announced an increase of SYP 10/kg on its purchase price of wheat as an incentive to producers to sell their wheat to its collection centres (SYP 36 and SYP 37/kg for soft and hard wheat respectively). Under the General Establishment for Cereal Processing and Trade, the Government had 140 centres countrywide for the collection of wheat; of these, 36 had silos with a total capacity of 4.5 million tonnes. Of the 140 centres, only about 40 are still functioning. This will significantly reduce the Government s ability to store the delivered wheat in good condition. Syria s storage losses are normally reckoned to be low. This year, however, outdoor stacking of bags of wheat, which will inevitably be the most common method of storage, is likely to result in increased storage losses from rodents, moulds and storage pests; stored grain, either under cover or in the open, will also be vulnerable to malicious damage. (These anticipated losses are accounted for in the cereal balance sheet in chapter 7. Theft of grain, however, is not considered to be a loss as it will presumably be consumed.) The level of farmers positive response to the Government s financial incentive is also open to question since the rapidly rising costs of labour, bags and transport have, in many cases, already cancelled out the incentive. 4. OTHER CROPS 4.1 Sugarbeet Annual production of sugarbeet for the three-year period averaged just over 1.3 million tonnes (FAOSTAT), the equivalent of perhaps tonnes of sugar and about tonnes of pulp and molasses for livestock feed. At present, only two of the country s four sugarbeet factories are operational, and MAAR expects that the area planted to sugarbeet this year will see a reduction of between 40 and 50 percent. 4.2 Cotton For a number of years prior to the present events, there was a significant decline in Syria s production of cotton. In 2000 and 2001, Syria produced more than 1 million tonnes of seed cotton, but by 2010 production was down to tonnes (MAAR, Annual Agricultural Statistical Abstract, various issues). The main causes of this reduction were the partial removal of subsidies, the increased cost of inputs, especially crop-protection sprays, and the poor financial returns to investment. This situation has been hugely exacerbated over the last two years as a result of the ongoing circumstances. Input prices have risen even more steeply than before, the necessary inputs are often not available, and several ginneries have been damaged. The effects are seen clearly in Hasakeh, previously an important cotton-producing governorate where in the past about ha of cotton were cultivated each year. According to the governorate s Agricultural Directorate, this area fell to an average of approximately ha between 2008 and 2012, and this year the area is expected to fall further to about ha, or just over one-eighth of the usual area of the past. Nationally, MAAR expects that the area planted to cotton will be down by between 60 and 70 percent this year. Of the country s eleven cotton ginneries only four are still functioning. 4.3 Tobacco In 2011 Syria produced some tonnes of tobacco from approximately hectares (FAOSTAT). MAAR expects that the area planted to tobacco this year may be reduced by between 20 and 30 percent. 4.4 Tree and horticultural crops Until recently, Syria has typically produced about 1 million tonnes of olives per year and exported part of its resulting virgin olive oil production ( tonnes in 2010 (FAOSTAT)). This year there are reports of olives in some conflict-affected areas not having been harvested since 2011, while in areas not affected by conflict growers complain of the escalating costs of irrigation, labour and fertilizer. Syria has, in recent years, been a significant exporter of tomatoes ( tonnes in 2010 (FAOSTAT)). Not only has the current conflict effectively eliminated this trade, but it has also severely

20 compromised production and domestic sales. Growers are now faced with low availability of inputs such as crop-protection chemicals which are proscribed under international trade sanctions, shortages of skilled labour, increasingly high costs of production across the board, and expensive and risky transport of their produce to diminished markets. 5. LIVESTOCK Prior to 2011, livestock played a very significant part in Syria s economy. Livestock production accounted for between 35 and 40 percent of the country s total agricultural production, and occupied about 20 percent of the labour force in rural areas. Mutton exports alone generated approximately USD 450 million as foreign currency per year. The poultry sector, which employed, directly and indirectly, more than 1 million workers was also an important foreign-income earner with significant exports of meat, eggs and day-old chicks. Poultry production was mainly a private-sector activity, with a public-sector share of less than 10 percent. Private cattle ownership was typically less than ten per household in a mixed-farming context, in addition to which there were eleven State dairy farms. During the last two years, the livestock situation has changed drastically with Government support impossible to implement in many parts of the country. In 2010, the country s livestock population was estimated at 15.5 million sheep, 2.01 million goats, 1.01 million cattle, and about buffalo. As a result of the current situation, the national sheep flock is thought to have fallen by 30 percent to less than 11 million, and the national cattle herd by 40 percent to just over There are reports of cattle herds being abandoned by their owners as a result of conflict, and the Hal Market abattoir in Damascus has seen a very high proportion of cows (as opposed to steers) being slaughtered. Syria used to export between two and 3 million sheep (mostly Awassi breed) to the Gulf countries each year. This number has now fallen to According to MAAR s Directorate of Animal Production and the Union of Agriculture Chambers, less than 35 percent of the country s poultry units were still operating by May 2013, and at least 50 percent of jobs in the poultry sector had been lost. Production of barley, the principal livestock concentrate, was low in recent years because of poor rainfall (66 percent of the planted area was unproductive in ); hopefully this year s relatively good production should go some way towards easing that situation. On the other hand, imports of livestock feed and additives fell from 2.26 million tonnes in 2010 to 1.4 million tonnes in 2012, and have continued to fall since then, while concomitantly the cost of feed has risen in terms of Syrian pounds (Table 6). Table 6: Syria - Indicative feed prices, SYP/t, 2011 and 2013 Governorate Feed Rural Damascus Maize Soya cake Tartous Soya cake Source: MAAR. Government support to the livestock sector was, until recently, highly developed. Veterinary services were provided free of charge by State veterinary units. Livestock vaccines were produced in Syria, and there were 54 private factories producing veterinary drugs. By May 2013 it was estimated that at least 40 percent of these private factories had been destroyed and that the rest had gone out of business. Vaccines are no longer produced in the country and existing stocks are almost exhausted. This has particularly serious potential implications, especially in view of the fact that many animals are being sold in neighbouring countries as a last resort. Fortunately, no serious outbreaks of livestock diseases have been reported in Syria in However, in Turkey, confirmed cases of bovine tuberculosis, peste des petits ruminants and rabies are suspected of having emanated from Syria, and there are reports of lumpy-skin disease in Lebanon, Jordan and West Bank that may have been spread from Dara a Governorate. This is therefore not just a serious national, but also a serious regional, animal-health problem waiting to explode.

21 LOCAL FOOD MARKET CONDITIONS The trade sector, including food commodity trade, is one of the main employers of low-skilled workers. This sector incurred a major disruption due to a combination of factors, including reduction in demand because of reduced purchasing power, high food prices, bottlenecks in supply chains (risks, delays etc. on roads bringing produce to market), and higher energy and import costs driven by the sharp depreciation of the Syrian currency and economic sanctions. To understand the extent to which the ongoing crisis is affecting local market conditions, the mission reviewed available Government and secondary data (including food commodity prices), carried out key informant interviews during field visits in Homs, Tartous and Qamishly and collected additional qualitative data from individual traders. A simple trader questionnaire was developed to cover availability of basic food commodities in local markets, changes in their prices, traders response capacities and their main constraints. The questionnaire was administered by the staffs of the Ministry of Agriculture (MAAR) who reside in the governorates. They were trained in Damascus. A total of 32 individual traders were returned by interviewers instead of 26 planned for 13 governorates Wheat supply chain The wheat supply chain has been substantially disrupted by the ongoing crisis. Wheat is particularly important within the Syrian diet, it provides about 40 percent of households calorie consumption, and is consumed primarily as bread. As such, the supply chain of wheat, flour, and bread is predominantly managed by the Government. The General Establishment for Cereal Processing and Trade (HOBOOB) is responsible for Government wheat grain procurement through collection centers. Of the 140 collection centers owned by the Government only 40 are still operational due to the ongoing crisis. Disruptions to procurement are particularly high in Al-Hasakeh governorate (a main wheat and barley production area); where only six of 40 collection centers are currently operating. Wheat production is subsidized by the Government through the payment of premium prices to growers. Bread consumption is also subsidized through retail prices set below the cost of production. The crisis has led to fuel shortages and limited access to farms in some major production areas, inhibiting farmers capacity to bring in the harvest. The premium price that Government pays for wheat is a strong incentive for farmers to sell to Government collection centers. In a normal year, as much as 80 percent of wheat harvested is sold through the collection centers. The remaining 20 percent is either kept for own consumption, or sold to private millers within the local governorates. This year, the Mission estimates that farmers will sell far less to the collection centers; perhaps up to 60 percent of their harvest. The crisis has affected both harvest activities, as well as the transport of crops to collection centers. Lower stocks at collection centers are related to a variety of factors; these include larger post-harvest losses, fuel shortages, higher transport costs, limited access to major production areas, and reduced storage capacities. To attract more selling into the collection centers, the Government has increased wheat procurement price by 40 percent (from 26 SYP/kg to SYP/kg). This increase was slightly above the international price which is currently equivalent to 35 SYP/kg. The increase of wheat procurement price is expected to compensate partially for the increase of transaction costs incurred by farmers and encourage them to sell to HOBOOB. However this incentive is likely to be overtaken by inflation and other expenses - bags and transport costs, etc. Most of the national wheat flour milling capacity and bakeries producing standard bread products are either no longer operating or are operating at low capacity. The Government owns 26 mills and contracts 35 others. It also owns 122 bakeries in addition to 90 other bakeries co-owned with the private sector. Bread production by bakeries is severely affected by shortages of yeast. Of the four yeast factories, only one is still operating. Reportedly, many bakeries have been damaged. Most private bakeries are either no longer operating or operating at low capacity due to either shortages of fuel, wheat flour, or yeast. The relatively few private bakeries that are still operating often rely on informal and cross border trade to obtain wheat flour and yeast supplies; and this is contributing to higher operational costs. 2 No data received from Dara a.

22 Figure 6: Wheat supply chain Source: Based on Discussions with Key Informants. 6.2 Availability of food commodities in local markets Most interviewed traders indicated that markets are fully operating in areas less affected by the crisis such as Lattakia, Tartous, Sweida, Damascus and Al-Hasakeh. Although food commodities are available in all governorates, most traders reported that quantities for sale in local markets have reduced compared to last year (Figure 7). The reduction in quantities is applicable to all basic food commodities, regardless of whether they are produced locally (bread, wheat flour, legumes, vegetables, fruits, meat, dairy products) or imported (sugar, vegetable oil, rice, pasta). As shown in Figure 7, a higher proportion of respondents reported lower quantities of wheat and wheat flour in local markets. This is particularly true in governorates severely affected by the crisis. There are also reports about changes in the quality of wheat flour and bread. More wheat grain is going into wheat flour production, which means that bread is being made with more bran. Many consumers do not prefer more bran in their bread, and thus there is a perception of inferior bread quality.